The cost of construction in Pakistan has increased significantly in the past year, with varying levels of impact across different segments. Here’s a brief breakdown:
Overall Increase:
- Estimate: 20-40% increase overall in construction costs since December 2022.
Segment-Specific Increases:
- Materials:
- Bricks: Price doubled (from 6,800 PKR/1,000 to 14,000-15,000 PKR/1,000)
- Crush (construction aggregate): Up 10-20% depending on type
- Cement: More stable, but rising slightly with transportation costs
- Steel: Fluctuating, but generally higher than last year
- Labor:
- Skilled labor: 10-15% increase in wages
- Unskilled labor: 5-10% increase in wages
- Services:
- Architects, engineers, contractors: Fee increases ranging from 5-15%
- Permits, approvals: No significant change, but delays can increase costs
Reasons for Increase:
- Inflation: General rise in cost of living impacting all sectors
- Rupee depreciation: Increased import costs for materials and equipment
- Fuel price hike: Transportation costs impacting material and labor prices
- Supply chain disruptions: Global shortages and delays affecting material availability
- Government policies: Some policies, like import restrictions, can further inflate prices
Impact:
- This rise in construction costs has made it more expensive to build new homes and renovate existing ones.
- Smaller projects are particularly affected as per-unit material costs are higher.
- The affordability of housing has decreased, pushing homeownership further out of reach for many Pakistanis.
Please note: These are general estimates and specific costs can vary greatly depending on location, project size, quality of materials used, and contractor chosen.
